By Janice Callander, Director, Asset Owners, Jersey
Perpetual trusts promise lasting legacies for ultra-high-net-worth (UHNW) families. Without experienced stewardship, that legacy can be at risk. Depending on jurisdiction, around 90% of wealthy families lose their wealth by the third generation. As family trees expand across generations and borders, the challenge is more nuanced than wealth preservation.
Perpetuity can be difficult to translate into real-world practice. Under a single-family trust, you might be arranging elder care, seeding a cleantech startup and advising a young beneficiary on a prenuptial agreement all at once. While they may share a bloodline, beneficiaries within the same family can have wildly different needs. This is what “forever” looks like in practice: more complexity, more people, more change.
Several jurisdictions, including Jersey and Guernsey, now permit trusts of unlimited duration. In principle, this is a huge asset for families building a lasting legacy. In reality, it’s a massive governance challenge.
In this article, we’ll explore the specific needs of UHNW families with a perpetual trust and why professionalising their generational wealth transfer is an essential step in safeguarding their assets across the ages.
What are perpetual trusts?
A perpetual trust is a structure with no end date, designed to preserve wealth indefinitely while adapting to the needs of new generations.
When trusts ended after a set period, the beneficiary pool was generally a tidy triangle: the founder, their children, and their grandchildren. With no fixed end date, that triangle becomes an ever-widening web, including spouses from different countries and tax systems, fourth-generation cousins who have never met, and beneficiaries whose values understandably diverge from the founder’s.
Why perpetual trusts present a unique challenge
With so many different beneficiaries and value systems at play, we see three frictions that consistently emerge and increase the potential for disaffection:
- Value drift: The founder’s original intent clashes with the priorities of a new era. “Entrepreneurial grit” becomes “inclusive opportunity” becomes “climate stewardship.” Respecting each beneficiary’s perspective can feel like walking a tightrope
- Diverging needs: For one generation, you’re concerned with the high cost of elderly care. In the middle, lifestyle maintenance and retirement planning. Then, at the opposite end, seed funding for startups or structured support for other ambitions
- Jurisdictional spread: International marriages, education and mobility introduce complex cross-border tax and reporting challenges
How to keep a perpetual trust current
For a trust to last in perpetuity, its governance must evolve at least as quickly as the family itself does. The purpose of good governance isn’t to make everyone happy; it’s to make defensible and fair decisions that honour both the founder’s wishes and the evolving needs of their family over time.
Keeping a trust current starts with stress-testing the instrument itself. Can the deed accommodate modern realities, such as blended families or global relocations, and are the trustee powers still fit for purpose?
Equally important is interpreting the Letters of Wishes in context. Experienced trustee oversight ensures the founder’s voice guides decision-making without handcuffing it, translating principles into contemporary and actionable language.
Finally, governance should extend beyond compliance. Clear decision-making processes, conflict protocols and escalation routes make the difference between subjective judgment calls that spark disputes and equitable, consistent stewardship.
The hidden pressure points in multi-generational wealth transfer
The most fragile moment in a perpetual structure is a handover between generations. This isn’t because either generation is unreasonable, but because the instructions are often vague.
The most common sources of conflict are control, participation and communication.
- Control: When founders are still running the operating business, questions of control versus continuity emerge. Should the trust hold or exit?
- Participation: If the next generation isn’t joining the business, the focus shifts to participation versus professionalisation. What should replace that shared mission?
- Communication: When families delay difficult conversations, silence can outweigh structure, turning avoidance into risk
Four steps to professionalising multi-generational wealth governance
Effective trust longevity requires continuity by design. In practice, this means creating a practical plan for who decides what, when and why.
Step 1: Set the objective
Step 2: Create a shared strategy
Step 3: Incremental restructuring
Step 4: Keep the objective in mind
Why impartial partners are essential to perpetual trust success
Impartial governance is the cornerstone to a successful perpetual trust as family members and longtime advisers are often too personally invested to remain objective. Engaging a professional fiduciary introduces balanced oversight, ensuring the family legacy is protected and that wealth continues to serve its purpose for generations to come.
How we can help
At IQ-EQ, we can relieve the administrative burden of servicing long-established structures, taking the strain and conflict out of the hands of family members and trusted advisors.
We help asset owners and family offices manage the trappings and complexity of accumulated wealth, structuring without unseating trusted advisers or unnecessarily disrupting sustainable long-term relationships.
Think of us as your virtual family office, with expertise that extends across the globe.
Our services leverage:
- Trustee and governance expertise designed for longevity
- Cross-border compliance capabilities
- Administration at scale for properties, insurance and personal assets
- Access to top medical professionals via premium medical insurance
- Dialogue-driven mediation prioritising empowerment, emotional wellbeing, mutual understanding between people in conflict
- Our global footprint across 25+ international locations
- A worldwide network of NEDs and other specialists skilled and experienced in the provision of niche support
